Subsea 7 orders pipelay newbuild

Subsea 7, a subsidiary of Siem Offshore Inc., has signed contracts for a new-build, rigid pipelay and construction vessel. The overall project cost is $180-200 million and is based on fixed prices from the shipyard and equipment supplier. Subsea 7 will take delivery of the completed ship in 2Q 2007.

Offshore staff

Subsea 7, a subsidiary of Siem Offshore Inc., has signed contracts for a new-build, rigid pipelay and construction vessel. The overall project cost is $180-200 million and is based on fixed prices from the shipyard and equipment supplier. Subsea 7 will take delivery of the completed ship in 2Q 2007.

The vessel is 157 m long and 28.4 m wide and will have a top tension capability of 300 tons, which is upgradeable to 400 tons. The vessel will carry 3,500 tons of steel pipe on the main reel. It will have a 400-tons deepwater crane, a built-in deepwater ROV spread, and a comprehensive survey system. The vessel will be able to install flexible flowlines and umbilicals.

The vessel is much larger than the company'sSkandi Navica pipelay vessel. It will have 50% more carrying capacity and double the top tension capability.

"We have seen considerable growth in our business since Subsea 7 was formed in 2002, and this is a fantastic opportunity for us to consolidate our position in the premier tier of contractors. The investment in a new vessel also demonstrates our considerable commitment to the global marketplace for underwater engineering and pipeline construction operations," Mel Fitzgerald, CEO, Subsea 7, says.

SIEM's board of directors performed a medium- to long-term market assessment for rigid pipelay and subsea construction. The board expects demand to grow and deeper water development to be a significant portion of that growth, particularly in West Africa and Brazil. SIEM will finance the new vessel through a combination of debt, existing liquidity, and operational cashflow.

6/03/05

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